VANCOUVER, British Columbia (Reuters) - Fourteen months after 360networks Inc splashed on to the market with a high-profile chief executive and grand plans for a worldwide fibre-optic network, the question it faced last Friday was whether it could ever pick up the pieces again after its financial collapse.

The company, which filed for protection from creditors last Thursday, believes its core business is still viable, but those investors who were able to trade their shares last Friday headed for the doors and pushed the already battered stock price down to a record low.

360networks owns TeleBermuda International, one of the Island's two long distance telephone operators. At this point, TBI has not been included in the bankruptcy and TBI officials insist that it is operating as usual.

360networks shares on the Toronto Exchange dropped 16 Canadian cents yesterday, or nearly 52 percent, to close at 15 Canadian cents on a volume of 8.3 million. Investors who wanted to trade on Nasdaq had to wait, as the US-based exchange maintained the trading halt it imposed on Thursday before the company sought protection.

The shares were at 21 cents on Nasdaq when they were halted, a far cry from their initial public offering price of $14 in April, 2000.

The petition seeking creditor protection with the British Columbia Supreme Court paints a picture of a company trapped in a cash-crunch death spiral, with reduced demand for its still uncompleted fibre-optic network, which led to liens and threats of litigation from creditors and suppliers.

"Rumours about the petitioners' financial position have negatively impacted their relationship with suppliers, the collection of outstanding accounts receivable and their ongoing arrangements with significant customers," chief executive Greg Maffei said.

Maffei, a former chief financial officer of computer giant Microsoft Corp., was one of 360networks' major selling points when it made its initial offering - just as the telecommunications sector was falling out of favour with Wall Street investors.

The company, once named Worldwide Fiber Inc., was a spin-off of private Canadian construction company Ledcor Industries. It planned to build a $7 billion global network stretching 89,000 miles and linking 100 major population centres in North America, South America, Asia and Europe.

As tight capital markets made customers shy away from buying capacity on the network, 360networks scaled back construction plans by $1 billion, laid off 44 percent of its workforce, and made a desperate but unsuccessful attempt to raise $300 million in bridge financing.

The company said at the end of 2000 it had assets of $5.6 billion and liabilities of about $2.8 billion.

"The 360 group continues to believe its core businesses are viable, based on its amended business plan. However, as a result of the working capital deficit currently facing the petitioners, the petitioners are no longer able to meet their obligations as they come due," the company told the British Columbia court.

The company said it has access to $155 million and wants to complete its network in North America.

"The 360 group is well situated to become a viable participant in the telecommunications sector if it survives the upcoming key transition period in which it expects to activate and exploit its network and move from network builder to service operator," the company said in Canadian court papers.

Telecommunications advisor Eamon Hoey believes 360networks was the victim of "Wall Street greed", and stock analysts who demanded rapid growth in fibre-optic network capacity without bothering to find out if anyone was actually going to use it when it came on line.

Toronto-based Hoey has doubts that 360networks can survive even as a smaller company because there is already enough capacity now available to meet even a growth in demand.

"The answer is: No. Can't. Not possible - because nobody is going to finance any of this stuff. Telecom is in the can for four or five years and there is more to come," Hoey said.

A hearing on the Canadian petition is scheduled for Vancouver on July 20.